1

See 42 U.S.C. s 1396d(b) (1991); United States General Accounting Office, Medicaid: Restructuring Approaches Leave Many Questions, GAO/HEHS 95-103 (April 1995) [hereinafter Restructuring Approaches].

2

This includes the 50 states, the District of Columbia, Puerto Rico, and the U.S. territories.

3

42 U.S.C. s 1396.

4

Restructuring Approaches, supra note 1; see also 42 U.S.C. s 1396. For example, in fiscal year 1993, 13 states, including New York, received 50 cents for every dollar spent on their respective Medicaid programs, whereas Mississippi, West Virginia, and Utah each received more than 75 cents for every Medicaid dollar spent. Yet, because of the differences in prices, and the benefits and services offered, New York receives $3600 per beneficiary in federal aid, while Mississippi receives $1900.

5

Restructuring Approaches, supra note 1. States must cover inpatient and outpatient hospital care, physician services, laboratory and x-ray services, and preventive health services for children. They have the option of choosing to include services such as prescription drugs and dental, vision, and transportation services.

6

Federal law requires states to cover all individuals receiving: Aid for Dependent Children (AFDC); Supplemental Security Income; non-AFDC low-income children; pregnant women; and low-income Medicare beneficiaries. Restructuring Approaches, supra note 1, at 3. States, however, have considerable latitude in defining eligibility standards for AFDC and certain other programs. Id. At their option, states may also provide Medicaid benefits to other medically needy individuals. Id.

7

Health Insurance for the Aged Act s 1902(a), codified as 42 U.S.C. s 1396(a). To participate in Medicaid, the state must submit to the Department of Health and Human Services (HHS) a state Medicaid plan that complies with federal standards. 42 U.S.C. ss 1396(a), (b). HHS reviews the plan to ensure that it satisfies all federal requirements for participation. Only after the Secretary has approved the state plan can the state begin to participate in the program. To make a significant change in an approved plan, the state must submit the amendment to the Secretary of HHS and obtain approval for the proposed change. States that elect to participate in the Medicaid program are required to pay hospitals for, inter alia, inpatient and outpatient services provided to Medicaid beneficiaries. In addition, a state's Medicaid plan must include adequate safeguards to ensure that services are provided in a manner consistent with the best interests of Medicaid beneficiaries.

8

For instance, Nevada serves 284 Medicaid beneficiaries for every 1,000 poor or near-poor individuals in the state, while Rhode Island serves 913 per 1000. Mississippi spends less than $2400 per person on Medicaid services, while New York spends an average of almost $7300 per person.

9

Comparability requires that medical services provided to an eligible individual shall not be less in amount, duration, or scope from those provided to any other individual. Tit. XIX, sec. 1902(a)(1)(B)(i)-(ii), 79 Stat. at 345 (codified as amended at 42 U.S.C. ss 1396(a)(10)(B)(i)-(ii)).

10

“Freedom of choice” requires that most eligible individuals may obtain medical services from any institution, agency, community, pharmacy, or person qualified to perform the services provided. Social Security Amendments of 1967, Pub. L. No. 90-248, tit. II, sec. 227(a), tit. XIX, sec. 1902(a)(23), 81 Stat. 821, 903 (codified as amended at 42 U.S.C. s 1396a(23)).

11

Teresa A. Coughlin et al., State Responses to the Medicaid Spending Crisis: 1988 to 1992, 19 J. Health Pol. Pol'y & L. 837 (1994) [hereinafter State Responses]; Restructuring Approaches, supra note 1. The increase in Medicaid costs can be ascribed, at least in part, to the extension of eligibility to include low-income children, pregnant women, the elderly, disabled persons, the homeless, and legalized aliens. See John Holahan et al., Explaining the Recent Growth in Medicaid Spending, at 184.

12

Between 1988 and 1990, Congress expanded eligibility to include low-income children, pregnant women, the elderly, disabled persons, the homeless, and legalized aliens. Holahan et al., supra note 11, at 184.

13

Restructuring Approaches, supra note 1, at 3.

14

Id.

15

Id.

16

Id. at 3-4.

17

Id. at 4.

18

Medicaid Source Book: Background, Data and Analysis, Congressional Research Service 3-4 (1993 Update) [hereinafter Medicaid Source Book].

19

Id.

20

United States General Accounting Office, Medicaid: States Turn to Managed Care to Improve Acccess and Control Costs, GAO/HRD-93-46 (March 1993) [[hereinafter States Turn to Managed Care].

21

42 U.S.C. s 1315 (a)(1)-(2).

22

HHS may grant a waiver for a demonstration program that “furthers the general objectives of [Medicaid].” See S. Rep. No. 1589 at 20, reprinted in 1962 U.S.C.C.A.N. at 1962. States must submit a proposal to HHS which indicates the statutory and regulatory mandates to be waived. Furthermore, the proposal application must discuss the impact of the waiver on program expenditures, relevant laws, and beneficiaries enrolled in the project. See Medicaid Source Book, supra note 18, at 418. After receiving the proposal, HHS has a technical review panel compare and evaluate the proposal's methodology and design, objectives, expected costs and returns, the state's knowledge and experience, and the potential risks to the health and safety of participants in research activity. See Allen Dobson et al., The Role of Federal Waivers in the Health Policy Process, Health Aff. 72 (1992); 48 Fed. Reg. 9266, 9269 (1983) (discussing exemption of certain research and development projects from regulation for protection of human research subjects). The review panel recommends either approval, conditional approval, or rejection of the proposal. See Dobson et al., supra, at 77. The Office of Research and Demonstration (ORD) send a recommendation to the agency's administrator, who subsequently decides whether to grant a waiver for the demonstration proposal. See id.

Projects whose net annual federal costs exceed $1 million and which affect more than 300 Medicaid recipients require the approval of both the HHS Assistant Secretary for Management and Budget and the White House Office of Management and Budget (OMB). See Elizabeth Andersen, Administering Health Care: Lessons from the Health Care Financing Administration's Waiver Policy-Making, 10 J. L. & Pol. 215, 227-28 (1994). Furthermore, states have to establish that the project will not cost the federal government more money-- “budget neutrality.” See Dobson et al., supra, at 85. However, HHS has started assessing budget neutrality over the projects' entire lives, rather than over each year of their existence. See 59 Fed. Reg. at 49, 250; Judith M. Rosenberg & David T. Zaring, Managing Medicaid Waivers: Section 1115 and State Health Care Reform, 32 Harv. J. on Legis. 545 (1995).

23

See PPRC Commissioners Express Concern with Section 1115 Medicaid Waivers, Health Care Pol'y Rep. (BNA) at D16 (Dec. 19, 1994); Sara Rosenbaum, An Advocates Guide to Section 1115 Waivers (1995); Rosenberg & Zaring, supra, note 22.

24

Rosenberg & Zaring, supra note 22.

25

See supra, note 21 and accompanying text (quoting section 1115 of the Medicaid Act).

26

See H.R. Res. 1414, 87th Cong., 2d Sess. s 24 (1962); S. Res. 1589, 87th Cong. 2d Sess. ss 19-20 (1962).

27

See, e.g., Aguyo v. Richardson, 352 F. Supp. 462 (S.D.N.Y. 1972), aff'd, 473 F.2d 1090 (2d Cir.), cert. denied, 414 U.S. 1146 (1973). See also Greater N.Y. Hosp. Ass'n v. Blum, 476 F. Supp. 234 (E.D.N.Y. 1979); Crane v. Mathews, 417 F. Supp. 532 (N.D. Ga. 1972); California Welfare Rights Org. v. Richardson, 348 F. Supp. 491 (N.D. Cal. 1972).

28

Blum, 476 F. Supp. at 243.

29

In 1982, in response to efforts by the Reagan Administration to use s 1115(a) to permit states to impose stringent and otherwise unlawful cost-sharing obligations on Medicaid recipients, Congress amended the Medicaid statute itself to circumscribe strictly the Secretary's research authority to undertake demonstrations in which benefits are found to outweigh risks and participation is voluntary, or provision is made for assumption of liability for preventable damage to beneficiaries involuntarily subjected to an experiment. Tax Equity and Fiscal Responsibility Act of 1982, Pub. L. No. 97-248, s 131(b), 96 Stat. 324, 367 (codified as amended at 42 U.S.C. s 1396o).

30

See, e.g., State of Tennessee, Section 1115 Medicaid Demonstration Waiver Application, TENNCARE, (June 16, 1993) [hereinafter Tennessee Waiver Application].

31

Florida Health Security is “designed to test a new approach to health insurance that, though partially financed by state and federal Medicaid funds, will extend coverage to approximately one million uninsured Floridians.” The waiver will cover individuals and families with incomes below 250 percent of the federal poverty level, who are U.S. citizens or documented aliens and Florida residents. State of Florida, Section 1115 Medicaid Demonstration Application, Florida Health Security, at E-2 (Feb. 9, 1994) [[hereinafter Florida Waiver Application].

32

Hawaii's demonstration project, Health QUEST, was implemented in August 1994. Its goal is to provide quality care, ensure universal access, encourage efficient utilization, stabilize costs, and transform the way in which health care is provided to public clients. Health QUEST covers traditional Medicaid recipiants: AFDC related families and poverty-related women and children, for a total of approximately 75,000 people. It also covers approximately 33,000 medically indigent adults and children receiving government assistance or who are uninsured. The demonstration project does not contain an enrollment cap. State of Hawaii, Section 1115 Demonstration Waiver Application, Health QUEST (April 19, 1993) [hereinafter Hawaii Waiver Application].

33

Illinois has proposed MediPlan Plus as its Section 1115 Waiver. The plan is available to all who qualify for Medicaid and are living in voluntary MediPlan Plus areas, with the exception of populations specifically excluded. The plan will provide health education in English or Spanish, outreach and social services, and case management services for pregnant women and young children. State of Illinois, Section 1115 Medicaid Demonstration Waiver Application, Illinois MediPlan Plus (Sept. 22, 1994) [hereinafter Illinois Waiver Application].

34

The goal of Missouri Health Care is to improve the accessibility and quality of health services in Missouri's Medicaid and state aid eligible populations while controlling the program's rate of cost increase. Missouri intends to achieve this goal by enrolling eligible Medicaid recipients in comprehensive, prepaid health plans that contract with the State to provide a specified scope of benefits to each enrolled member in return for a capitated payment made on a per member, per month basis. The waiver extends subsidized insurance coverage to certain low-income individuals not covered by traditional Medicaid benefits. State of Missouri, Section 1115 Demonstration Waiver Application, Missouri Managed Care Program (June 30, 1994) [hereinafter Missouri Waiver Application].

35

The Section 1115 Waiver Application presented by the State of New York essentially mandates managed care for almost all Medicaid eligible individuals and other persons who do not qualify for Medicaid but receive assistance from the State of New York's Home Relief program. The waiver, not terribly complicated in its approach to delivering health care, will affect 87% of New York's Medicaid eligible population (approximately 2.8 million individuals) shifting those individuals from a fee-for-service system to a managed care based program. State of New York, Section 1115 Demonstration Waiver Application, The Partnership Plan (March 17, 1995) [hereinafter New York Waiver Application]. The size of this demonstration program is unmatched as New York has the largest number of Medicaid recipients (3.6 million) and the largest program budget in the nation. Id. at 1-1.

36

Oregon's Medicaid Demonstration Project is designed to expand Medicaid eligibility to Oregonians with family income below the federal poverty level by redefining benefits through a prioritization process. The services will be provided through statewide use of managed care systems and target health care for the uninsured. The Oregon Legislature passed five laws that collectively affected the way Oregon would distribute health care in the 1990s. State of Oregon, Section 1115 Demonstration Project Waiver Application, Oregon Medicaid Demonstration Project (Aug. 1991) [hereinafter Oregon Waiver Application].

37

Tennessee's waiver application, TennCare, proposes to increase services and control cost. TennCare was approved by HCFA in November 1993 and was implemented on January 1, 1994. It defines a standard benefit package and emphasizes managed care, preventive services, and effective utilization of resources. Through this program, the state expects to provide quality health care to all of its current Medicaid population. TennCare has an enrollment cap of 1,750,000. Tennessee Department of Health Chapter 1200-13-12 Bureau of TennCare. This includes the current Medicaid population of roughly one million plus an additional estimated 775,000 currently uninsured and uninsurable individuals in the state. As codified, the total enrollment in TennCare shall not exceed 1,300,000 in the first full year of operation and shall not exceed 1,500,000 thereafter. The current proposal still includes coverage for the current Medicaid population; however, the additional number of individuals to be served in the program is 500,000. Tennessee Waiver Application, supra note 30, at Letter from David L. Manning, Department of Finance and Administration to Bruce Vladeck, Director of Health Care Financing Administration, November 11, 1993.

38

Medicaid Source Book, supra note 18, at 165.

39

See generally Sara Rosenbaum & Julie Darnell, Medicaid Section 115 Demonstration Waivers: Implications for Federal Legislative Reform, The Kaiser Commission (July 1995).

40

For example, the Tennessee Medicaid program provides health care coverage to the traditionally eligible groups. Tennessee Waiver Application, supra note 30, at 28. While the criteria for eligibility as an uninsurable will be the same as those currently used in CHIP, current membership in CHIP is not a pre-requisite for qualifying as uninsurable under TennCare, nor is it a barrier to enrollment in TennCare. Id. Tennessee will require families and individuals to pay a portion of their total insurance premiums, depending on their ability to pay. See id.

In Missouri, the eligible group include children and young adults under the age of 19 with family income below 200% of the federal poverty guideline for the applicable family size. A family with an income greater than 150% of the federal poverty level (FPL) for the applicable family size will be asked to contribute 25% of a premium established by the Department of Social Services for each child. See generally Missouri Waiver Application, supra note 34.

In Hawaii, low-income persons earning up to 300% of the FPL are covered so long as no employer-provided coverage exists. They are required to pay, on a sliding scale, a portion of the monthly premium. Those with an income which exceeds 300% of the FPL, but who are uninsured, may remain in the program if they pay the full premium amounts. See generally Hawaii Waiver Application, supra note 32.

In New York, the extension covers women and children (under one year) with up to 185% FPL, children up to age six that are up to 133% of the FPL, and children under 19 up to 100% FPL. See generally New York Waiver Application, supra note 35.

41

See, e.g., Florida Waiver Application, supra note 31, at E-2 (stating an intent to provide affordable health insurance for the large number of Florida residents who are uninsured because they fail to meet federal poverty guidelines).

42

See, e.g., Tennessee Waiver Application, supra note 30, at 28 (extending coverage to persons with an existing or prior existing health condition causing them to be uninsurable).

43

A major change in eligibility will be the elimination of the Medically Needy program which covers those who would not otherwise qualify for Medicaid under an SSI-related group because they exceed income or asset limits for those groups. Florida gives an unsympathetic description of the Medically Needy program recipients in justifying the phase-out of this program. The application explains that the program has little value in terms of health care prevention because the need to benefit from the program occurs when the recipient has costly major medical problems. Florida does not have a plan to fill the gap left when the Medicare beneficiaries under the Medically Needy program lose this program. Florida Waiver Application, supra note 31, at 65. Some states, however, have neither added the uninsurable adults nor provided for presumptive eligibility.

44

One mechanism used to exclude members from eligibility is to change the definition of family income. In Florida, family income has been changed to include the income of all individuals covered under the program (family unit), plus the income of any spouse or custodial parent of a person being covered who lives at the residence of the applicant, regardless of whether they are being covered by the premium discount program. Florida Waiver Application, supra note 31, at 41. Family income will include both earned and unearned income. Among items included in income are veterans' benefits, child support, and alimony. Id. The program also subjects demonstration eligible to income deeming of certain family members, such as stepparents, grandparents, and siblings. Rosenbaum & Darnell, supra note 39, at 5, at Table 2.

45

Florida will subject demonstration eligibles to income deeming of stepparents, grandparents, and siblings. Florida Waiver Application, supra note 31, at 41.

46

Rosenbaum & Darnell, supra note 39, at ss B-D.

47

See, e.g., Florida Waiver Application, supra note 31, at 228-49 (requesting a waiver of the standards requiring an asset test as part of eligibility determination).

48

See, e.g., Tennessee Waiver Application, supra note 31, at 100 (planning to discontinue retroactive eligibility so the state does not have to provide medical assistance for up to three months prior to the date of application for assistance).

49

Rosenbaum & Darnell, supra note 39, at ssB-D.

50

Medicaid Source Book, supra note 18, at 247.

51

See generally Rosenbaum & Darnell, supra note 39.

52

Missouri Waiver Application, supra note 34, at 7.

53

Id.

54

New York Waiver Application, supra note 35, at 2-29, 2-30.

55

See, e.g., Florida Waiver Application, supra note 31, at 79.

56

See, e.g., Missouri Waiver Application, supra note 34, at 7.

57

See, e.g., Florida Waiver Application, supra note 31, at 47 (waiving traditionally mandated coverage and cost containments for FQHC/RHS, but prohibiting the state from eliminating FQHC services as a mandatory Medicaid service).

58

Rosenbaum & Darnell, supra note 39.

59

Florida Waiver Application, supra note 31, at 77.

60

Jane Perkins & Michele Melden, The Advocacy Challenge of a Lifetime: Shaping Medicaid Waivers to Serve the Poor, Clearinghouse Rev. 864, 872 (December 1994).

61

Rosenbaum & Darnell, supra note 39.

62

Tennessee Waiver Application, supra note 30, at 31.

63

Id.

64

All care within a given community is capitated using a community rate based on historical health care costs in that community. The geographic basis for the delivery of TennCare services is the Community Health Agencies. Community Health Agencies, which were established under the Community Health Agency Act of 1989 for the purpose of coordinated services to the medically indigent across the state are located in both urban and rural areas of Tennessee. The CHA regions were established based on the concept of rational service areas. Each CHA is governed by a community-based board consisting of a representative of each county in the CHA region. There are 12 community health regions. Tennessee Waiver Application, supra note 30, at 32.

65

Rosenbaum & Darnell, supra note 39, at 10, Table 2. For instance, Hawaii eliminates cost-based FQHC/RHC payment methodology. The project requires the managed care organizations to include FQHCs/RHCs unless they can demonstrate reasonable access without contracting with the FQHCs/RHCs. New York alters the traditional treatment of health care providers to a certain extent. The most notable change is that FQHCs will no longer be reimbursed for 100% of their costs. The New York Plan, if approved, will reimburse FQHC on a reasonable cost basis. New York Waiver Application, supra note 35, at 6-2.

66

CHPA members may, however, purchase health plans that provide access to essential community providers; the essential community providers will be able to bill plans for services provided to AHP members. Florida Waiver Application, supra note 31, at 48.

67

At full implementation, Florida proposes to divert 50% of the DSH funds to FHS with funds initially earmarked for charity care going to finance FHS enrollment. Florida Waiver Application, supra note 31, at 91.

68

Rosenbaum & Darnell, supra note 39, at 10, Table 2.

69

Missouri Waiver Application, supra note 34, at 10. The Missouri plan would enroll all 540 school districts as school health providers for special education related services, administrative case management, and primary care. Under the New York Waiver, the Local Department of Social Services can “carve out” school based health clinics from the Plan and continue to reimburse those clinics on a fee-for-service basis. If a county opts to carve out such providers the state Medicaid funding will be frozen at the 1994 level, requiring the local district to make the combined state and local match for these services in order to obtain federal matching funds. New York Waiver Application, supra note 35, at 2-5.

70

Rosenbaum & Darnell, supra note 39; see also United States General Accounting Office, State Flexibility in Implementing Managed Care Programs Requires Appropriate Oversight, GAO/T-HEHS-95-206 (July 1995).

71

Tennessee Waiver Application, supra note 30, at 34. Tennessee will contract with each qualified managed care organization based on the capitation rate in that community for the provision of services to any eligible in that community. Id. Providers enrolled in the plans will be reimbursed by the plans on a negotiated basis. Id. The state then anticipates that annual capitation rates will be developed based on the lowest cost managed care organization meeting quality standards within each community.

72

Florida predicts that most FHS recipients will enroll in a managed care plan because of the individual's ability to meet the benchmark price and the lower out-of-pocket expenses offered by HMOs. Florida Waiver Application, supra note 31, at 85.

73

These waivers give the states authority to require managed care for Medicaid, AFDC-related, and non-Medicare-eligible SSI participants. Id. at 30.

74

Rosenbaum & Darnell, supra note 39; see also Medicaid Source Book, supra note 18, at 418.

75

Tennessee Waiver Application, supra note 30, at 25; Missouri Waiver Application, supra note 34, at 6.

76

HCFA has questioned how Florida will assure individuals with special needs access to essential providers with unique capabilities to serve these special populations in their geographic areas. Florida Waiver Application, supra note 31, at 49. Florida explains that any plan offered by CHPA members will be prevented from discriminating against persons with chronic and special health care needs because all providers must guarantee issue and community rate policies. Id. Individuals who reside in public health institutions such as MR/DD facilities will be ineligible for coverage under FHS. Id. at 64.

77

Missouri Waiver Application, supra note 34, at 26-31.

78

Tennessee Waiver Application, supra note 30, at 99. A waiver was given to expand eligibility to the following individuals: pregnant women and infants with income up to 184% of the official poverty line; children between ages one and five with incomes up to 133% of the official poverty line; children born after September 30, 1983, under the age of 19 whose family income exceeds 100% of the official poverty line, families with income up to 133 1/3% of the state's AFDC income payment standard for the Medically Needy; or other limits prescribed by the Secretary.

79

AFDC persons who are ineligible for AFDC cash payments will be eligible for the demonstration if they are currently uninsured. They will not be subject to resource (or asset) limits. Tennessee Waiver Application, supra note 30, at 100.

80

Florida Waiver Application, supra note 31, at 228-49.

81

Id.

82

Tennessee Waiver Application, supra note 30, at 99.

83

Florida Waiver Application, supra note 31, at 228-49.

84

Id.

85

Tennessee received a waiver of section 1927 by allowing plans to manage costs through establishment of their own formularies and by limiting the authorized formulary based on cost, therapeutic equivalent, and clinical efficacy. Tennessee Waiver Application, supra note 30, at 102. The State has asked for more stringent controls. It requested a waiver that will allow it to control costs by exempting drug providers from the best-price requirement for contract with TennCare HMOs and PPOs. Id. at 103.

86

Webster's Third New International Dictionary, Unabridged 11 (1993).

87

Andrew Jackson Institute, October 1994.

88

Michele Melden, Managed Care: How to Challenge Inadequate Access for Medicaid Beneficiaries?, Clearinghouse Rev. 228, 232 (July 1991) (citing 42 U.S.C. s 1396a(a)(30)(A)).

89

Id.

90

Id. at 229.

91

Id. at 230-31.

92

Id. at 230 (citing 42 U.S.C. s 1396a(a)(10)(B)(i); 42 C.F.R. s 440.240(b)).

93

Id.

94

Id.

95

Id.

96

Id.

97

Id.

98

42 C.F.R. s 440.230.

99

Melden, supra note 88, at 230.

100

Hispanics pay 57% of their own medical bills and Puerto Ricans pay 30% of their own medical bills. Hispanic Health in the United States, 265 J.A.M.A. 248 (Jan. 9, 1991) [hereinafter Hispanic Health].

101

Health Status of Minorities, at 360, Table 6.

102

Id. at 367.

103

Lack of insurance restricts access to health care for many Hispanics. Hispanic Health, supra note 100, at 248. Of the subgroups, Mexican-Americans, with 30% uninsured, are the most likely to be uninsured. Id.

104

Health Status of Minorities, supra note 101, at 367, Table 15. The rate of uninsured individuals could vary widely even within a group. For instance, 70% of Cubans have private insurance, but only 40% of Puerto Ricans have health insurance.

105

The magnitude of the impact, however, will vary not only among different minority communities but within groups as well.

106

Wilhelmina A. Leigh, Access To Primary Care For Underserved Americans: Summary Proceedings of a Roundtable, Joint Center for Political and Economic Studies 4-5 (1993).

107

Id. at 5.

108

Hispanic Health, supra note 100, at 248. Problems with language reduces the quality of care and impedes delivery. Id.

109

Haywood, Ethnicity and Medical Care, at 315.

110

Leigh, supra note 106, at 5.

111

Id. at 5, 6.

112

Haywood, supra note 109, at 325. The Puerto Rican subpopulation also prefers treating their seriously ill at home. Id. at 465. Because Hispanics are more likely to view their illness in terms of folk practices, some Hispanics seek out folk healers instead of doctors. Hispanic Health, supra note 100, at 248. Mexican-Americans present their illness to their friends and family for opinions before seeking medical assistance. Haywood, supra note 109, at 301. Mexican-Americans consider the needs of the family ahead of the needs of the individual. Id. at 322. The rural residence of some also serves as a barrier to health care. Healthy People 2000, U.S. Dept. of Health & Human Services [hereinafter Healthy People]. There is a close association between sickness and religion for many Mexican-Americans. Religious activities are performed to regain health, some homes have altars, and sometimes masses are performed in a home. Haywood, supra note 109, at 325-26. Some Mexican-Americans feel sickness is a punishment from God and suffering is a part of God's plan. Id. 5-26.

113

Healthy People, supra note 112, at 35.

114

Geraldine Dallek, Health Care for America's Poor: Separate and Unequal, Clearinghouse Rev. 361, 363-64 (Special Issue, Summer 1986).

115

Jane Perkins, Increasing Provider Participation in the Medicaid Program: Is There a Doctor in the House?, 26 Hous. L. Rev. 77, 79 (1989).

116

Id. In Kentucky, 90% of the physicians surveyed claimed to serve Medicaid patients, while at the same time reporting that Medicaid patients made up less than 1% of their practice. Id. at 80. Moreover, for prenatal care, which is vital to the minority community, physician participation is lower than other specialties. In California, the lack of obstetricians that serve Medicaid patients is critical. In 1988, it was estimated that 175,000 Medicaid eligible women of child-bearing age were without access in half of California's 58 counties.Id. at 82. Women were waiting 16 weeks for a prenatal care appointment, while women with private insurance did not experience a physician shortage, nor extended waiting for care. Id.

117

Id. at 83.

118

Id. at 84-85.

119

Id. at 85-86.

120

Id. at 86. The study, by the American Academy of Pediatrics, also indicated that 35.8% of the pediatricians found the paperwork burdensome. Id.

121

Id. at 87.

122

Id.

123

Id. at 88.

124

Vernellia R. Randall, Racist Health Care: Reforming an Unjust Health Care System to Meet the Needs of African-Americans, 3 Health Matrix 127 (1993).

125

Id. at 148; Alan Sager, The Closure of Hospitals that Serve the Poor: Implications for Health Planning, A Statement to the Subcommittee on Health and the Environment, Committee on Energy and Commerce, U.S. House of Representatives, 2 (April 30, 1982); Mark Schlesinger, Paying the Price: Medical Care, Minorities, and the Newly Competitive Health Care System, in Health Policies and Black Americans 275-76 (David Willis ed., 1989).

126

Randall, supra note 124, at 151; Equal Access to Health Care: Patient Dumping, Hearing before a Subcommittee of the Committee on Government Operations, 100 Cong, 1st Sess. 270-87 (July 22, 1987); Robert L. Schiff, et al., Transfers to a Public Hospital: A Prospective Study of 467 Patients, 314 New Eng. J. Med. 552-57 (1986); Stan Dorn et al., Anti-Discrimination Provisions and Health Care Access: New Slants on Old Approaches, Clearinghouse Rev. 439, 441 (Special Issue, Summer 1986).

127

Randall, supra note 124, at 154.

128

Perkins & Melden, Section 1115 Medicaid Waivers: An Advocate's Primer, at 20-21.

129

Id. at 20-25.

130

See generally Florida Waiver Application, supra note 31; Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34, at 27 (Request for Proposal).

131

See generally Florida Waiver Application, supra note 31; Missouri Waiver Application, supra note 34.

132

Missouri Waiver Application, supra note 34, at 27.

133

Id.

134

See generally Hawaii Waiver Application, supra note 32; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 37.

135

Florida Waiver Application, supra note 31, at 81 (Response to HCFA); Missouri Waiver Application, supra note 34.

136

New York Waiver Application, supra note 35, at 35 (answers submitted to HCFA on August 4, 1995, in response to HCFA questions of June 30, 1995).

137

Perkins & Melden, supra note 128, at 24.

138

Missouri Waiver Application, supra note 34, at 28; New York Waiver Application, supra note 35; Tennessee Waiver Application, supra note 37, at 16 (Responses to HCFA).

139

Missouri Waiver Application, supra note 34, at 28.

140

Perkins & Melden, supra note 128, at 24.

141

See generally, Missouri Waiver Application, supra note 34; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36.

142

New York Waiver Application, supra note 35 (answers submitted to HCFA on August 4, 1995, in response to HCFA questions of June 30, 1995).

143

Florida Waiver Application, supra note 31, at app. C (Florida's Medicaid Current Service Coverage, Florida Health Security, Feb. 9, 1994).

144

Florida Waiver Application, supra note 31, at 56 (responses to HCFA questions, April 1994); Hawaii Waiver Application, supra note 32, at 1-9; Illinois Waiver Application, supra note 33, at 37; New York Waiver Application, supra note 35, at 2-27.

145

Perkins & Melden, supra note 128, at 25.

146

Id.

147

Florida Waiver Application, supra note 31, at 228-49; Hawaii Waiver Application, supra note 32, at abstract.

148

Missouri Waiver Application, supra note 34, at 5-18.

149

Illinois Waiver Application, supra note 33, at 37; New York Waiver Application, supra note 35, at 2-27; Oregon Waiver Application, supra note 36, at 7.1; Tennessee Waiver Application, supra note 37, at 98.

150

Perkins & Melden, supra note 128, at 24.

151

Florida Waiver Application, supra note 31, at 228-49.

152

Missouri Waiver Application, supra note 32, at 5-18.

153

Hawaii Waiver Application, supra note 32, at 4-4.

154

See generally Oregon Waiver Application, supra note 36.

155

See Perkins & Melden, supra note 128.

156

Florida Waiver Application, supra note 31, at 71-72; Illinois Waiver Application, supra note 33, at 46; New York Waiver Application, supra note 35, at 2-3; Oregon Waiver Application, supra note 36, at 3-5.

157

Florida Waiver Application, supra note 31, at 71-72.

158

Id.

159

See generally, Missouri Waiver Application, supra note 34.

160

Perkins & Melden, supra note 128, at 22.

161

Oregon Waiver Application, supra note 36, at 4.30.

162

See generally Hawaii Waiver Application, supra note 32; Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34.

163

Perkins & Melden, supra note 128, at 22.

164

Illinois Waiver Application, supra note 33, at 48; Missouri Waiver Application, supra note 34, at 18; Oregon Waiver Application, supra note 36, at 15-17. See generally New York Waiver Application, supra note 35; Tennessee Waiver Application, supra note 30, Tennessee Health Campaign Literature.

165

Oregon Waiver Application, supra note 36, at app. IV.

166

Perkins & Melden, supra note 128, at 20.

167

Illinois Waiver Application, supra note 33, at app. D, Healthy Moms/Healthy Kids Waiver Program; Missouri Waiver Application, supra note 34, at 22; Oregon Waiver Application, supra note 36, at 15-16.

168

See generally Missouri Waiver Application, supra note 34.

169

Perkins & Melden, supra note 128, at 20, 21.

170

Florida Waiver Application, supra note 31, at 67 (responses to HCFA questions); Illinois Waiver Application, supra note 33, app. D.; Oregon Waiver Application, supra note 36, at 3.13; Tennessee Waiver Application, supra note 37 (Provider Network Analysis, Attachment to Letter from David L. Manning, Commissioner to Bruce Valdeck, HCFA, November 11, 1995).

171

Florida Waiver Application, supra note 31, at 67 (responses to HCFA questions); Illinois Waiver Application, supra note 33, at app. D.

172

Illinois Waiver Application, supra note 33, at 61.

173

Perkins & Melden, supra note 128, at 21.

174

Id.

175

Id.

176

Florida Waiver Application, supra note 31, at 67 (responses to HCFA questions); Illinois Waiver Application, supra note 33, at 61.

177

Perkins & Melden, supra note 128, at 26, 28, 30.

178

Florida Waiver Application, supra note 31, at 64; Illinois Waiver Application, supra note 33, at 65; Oregon Waiver Application, supra note 36, at 3.16. See generally Tennessee Waiver Application, supra note 30.

179

Florida Waiver Application, supra note 31, at 64 (responses to HCFA questions).

180

Perkins & Melden, supra note 128, at 20-21.

181

Id. at 22.

182

Illinois Waiver Application, supra note 33, at app. D; Missouri Waiver Application, supra note 34, at 30; Oregon Waiver Application, supra note 36, app. IV, at 15; Tennessee Waiver Application, supra note 30 (letter to HCFA in answer to requested response to questions, August 4, 1993).

183

Tennessee Waiver Application, supra note 30 (letter to HCFA in answer to requested responses to questions, August 4, 1993).

184

Perkins & Melden, supra note 128, at 22.

185

Missouri Waiver Application, supra note 34, at 30; Tennessee Waiver Application, supra note 30 (Provider Network Analysis, attachment to letter from David L. Manning, Commissioner, to Bruce Vladeck, HCFA, November 11, 1993).

186

Tennessee Waiver Application, supra note 30 (Provider Network Analysis, attachment to letter from David L. Maning, Commissioner, to Bruce Vladeck, HCFA, November 11, 1993).

187

Perkins & Melden, supra note 128, at 23.

188

Missouri Waiver Application, supra note 34, at 30; Tennessee Waiver Application, supra note 30, at 18 (letter to HCFA in answer to requested responses to questions).

189

Perkins & Melden, supra note 128, at 22.

190

Florida Waiver Application, supra note 31, at 56 (responses to HCFA questions); Missouri Waiver Application, supra note 34, at 30-31; Oregon Waiver Application, supra note 36, at 15; Tennessee Waiver Application, supra note 30, at 17 (responses to questions).

191

Missouri Waiver Application, supra note 34, at 30-31.

192

See generally Hawaii Waiver Application, supra note 32.

193

See generally Missouri Waiver Application, supra note 34; Tennessee Waiver Application, supra note 30.

194

See generally Florida Waiver Application, supra note 31; Illinois Waiver Application, supra note 33; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36.

195

Perkins & Melden, supra note 128, at 23.

196

Florida Waiver Application, supra note 31, app. B; Illinois Waiver Application, supra note 33, app. D; Missouri Waiver Application, supra note 34, at 3-28; Oregon Waiver Application, supra note 36, at 1-3.

197

Oregon Waiver Application, supra note 36, app. IV.

198

Hawaii Waiver Application, supra note 32, at 1-3; Tennessee Waiver Application, supra note 30, at 49.

199

Hawaii Waiver Application, supra note 32, at 1-3.

200

Perkins & Melden, supra note 128, at 23.

201

Hawaii Waiver Application, supra note 32, at 32; Missouri Waiver Application, supra note 34, at 3-28.

202

Missouri Waiver Application, supra note 34, at 45.

203

Perkins & Melden, supra note 128, at 24.

204

Illinois Waiver Application, supra note 33, at 32; Oregon Waiver Application, supra note 36, at 3-28.

205

Perkins & Melden, supra note 128, at 23.

206

Illinois Waiver Application, supra note 33, at 45; Oregon Waiver Application, supra note 36, at 3-28.

207

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; Tennessee Waiver Application, supra note 30.

208

Perkins & Melden, supra note 128, at 25.

209

Hawaii Waiver Application, supra note 32; Hawaii: Health Quest May be Off to a Rocky Start, Health Line, Sept. 1994; Illinois Waiver Application, supra note 33, at 36; Missouri Waiver Application, supra note 34, at 45.

210

Illinois Waiver Application, supra note 33, at 36-38.

211

See generally Florida Waiver Application, supra note 31.

212

Rosenberg & Zarig, supra note 22, at 554.

213

Id. at 554.

214

Marsha Gold et al., Managed Care and Low-Income Populations: A Case Study of Managed Care in Tennessee, The Kaiser Foundation 35 (July 1995).

215

Id. at 35.

216

Emily Friedman, The Eternal Triangle: Cost, Access, and Quality 17 Physician Executive 3 (July-Aug. 1991).

217

Id. at 3.

218

W.A. Hassouna, A Strategy Against Poverty, Quality Health Care at Affordable Cost, 47 World Health 6 (Nov.-Dec. 1994).

219

Linda A. Headrick & Duncan Neuhauser, Quality Health Care, 271 J.A.M.A. 1711 (1994). A clinic in Atlanta used continuous improvement techniques to identify factors associated with the 22.3% rate of cesarean section deliveries. The clinic identified two factors that were common for more than 50% of the repeated caesarean sections: 1) failure to progress and 2) patient requests. First, no agreement on what was considered failure to progress could be found. The clinic defined failure to progress by local consensus. Second, patient requests were based on unfounded beliefs that once you have had a caesarean you must always have a caesarean. They established an education program which educated patients that vaginal delivery was still an option. The first year following the implementation of the recommendations the caesarean section rate dropped to 17.8%, with no ill effects to either mothers or infants. Five years after implementation, the rate has continued to drop to 15.7%. Id. at 1711.

220

Timothy Stoltzfus Jost, The Necessary and Proper Role of Regulation to Assure the Quality of Health Care, 25 Hous. L. Rev. 525, 526 (1988).

221

Barry R. Furrow, The Changing Role of the Law in Promoting Quality in Health Care: From Sanctioning Outlaws to Managing Outcomes, 26 Hous. L. Rev. 147, 154 (1989).

222

Id. at 153.

223

Vernellia R. Randall, Managed Care, Utilization Review, and Financial Risk Shifting: Compensating Patients for Health Care Cost Containment Injuries, 17 U. Puget Sound L. Rev. 1 (1993).

224

Id. at 1.

225

Furrow, supra note 221, at 153 (citing Brook & Kosecoff, Commentary: Competition and Quality, 7 Health Aff. 150, 157 (1988)).

226

Id.; see also Avedis Donabedian, The Methods and Findings of Quality Assessment and Monitoring 150 (1985).

227

Randall, supra note 223, at 1.

228

Furrow, supra note 221, at 153; A. Donabedian, Evaluating the Quality of Medical Care, 44 Millbank Memorial Fund Q. 166, 167-70 (1966).

229

Furrow, supra note 221, at 153.

230

Id. at 155.

231

Id.

232

Id.

233

Id. For instance, outcomes such as death are easily measured, while other outcomes such as patient attitudes, satisfaction, and social restoration present greater difficulties. Id.

234

Id. at 155-56.

235

Id. at 156.

236

Id.

237

In 1994, US HealthCare, in Blue Bell, Pennsylvania, became the first HMO to publish performance report cards showing how all of its health plans scored in selected clinical areas based on the Health Plan Employer Data and Information Set (HEDIS). Carol Sardinha, US HealthCare Releases HEDIS-Based Report Card, 7(16) Managed Care Outlook (Aug. 12, 1994). The NCQA considers HEDIS to be the only uniform national standard for evaluating and comparing the performance of HMOs and other plans. Id. at 1.

238

Sardinha, supra note 237, at 1. The Clinton Health Care Plan relied heavily on the use of performance report cards for assuring quality. The Health Security Act appears as H.R. 3600, 103d Cong., 1st Sess. (1993) and as s 1757, 103d Cong., 1st Sess. (1993) ss 1325, 5005, 5012.

239

Jason Ross Penzer, Grading the Report Card Lessons from Cognitive Psychology, Marketing, and the Law of Information Disclosure for Quality Assessment in Health Care Reform, 12 Yale J. on Reg. 207, 221 (1995).

240

Id.

241

Id. at 222.

242

Id. at 223.

243

Robin Elizabeth Margolis, Can Total Quality Management Help Care for the Poor, 11 Healthspan 19 (1994).

244

Id. at 19.

245

TQM principles include: (1) a clear organizational mission, understood by all employees, must be developed by the health care entity; (2) the mission must be placed in a strategic plan or statement articulating the organization's vision of the future, and the values and strategies that the organization will use to achieve its mission; (3) a commitment to listen carefully to customers (or patients, in a health care setting) about their wishes;--empowerment of employees to solve their own problems, as long as they work in accordance with the health care entity's mission and strategic plan; (4) a scientific or benchmark approach to work, described as the “plan, do, check, act cycle,” so that results will be available for use in improving performance; and, (5) a commitment to continue improving rather than resting on a satisfactory plateau. Margolis, supra note 243, at 19.

Studies show that doctors incomes rose in direct proportion to the services proscribed. Jost, supra note 220, at 526. Recent studies done under total quality management suggest that too many resources have been wasted due to the current system which discourages economy and efficiency. Id.

246

Robin Elizabeth Margolis, Can Total Quality Management Help Care for the Poor, 11 Health Span 19 (Sept. 1994). TQM principles must be modified in accordance with the realities of the public hospital setting. Id. The emphasis on customer satisfaction in corporate TQM efforts cannot always be translated to hospitals. Id. For example, the conflict between the desire of poor patients' families and friends to visit patients freely, and the cumbersome security precautions that hospitals must undertake in high crime areas causes commentaters to ask “whose expectations must be met or exceeded?” Id. at 19.

247

John D. Ayres, The Use and Abuse of Medical Practice Guidelines, 15 J. Legal Med. 421 (1994). Initially, the guidelines focused on such areas as immunization. The guidelines now have developed to include “a plethora of diagnostic and therapeutic treatment recommendations from many national medical organizations.” Id. (reporting that more than 60 organizations have produced over 1600 such guidelines).

248

Id. at 421.

249

Id. at n.8. In fact, the guidelines have had a much broader application by insurers in determining payment to hospitals and physicians, courts in litigating medical malpractice, and legislatures in applying practice parameters as the standard of care in an alternative dispute resolution system. Id. at 421.

250

Id. at 424.

251

Id. at 425.

252

Id.

253

Furrow, supra note 221, at 147.

254

Id. at 153; see, e.g., Kollmorgen v. State Board of Medical Examiners, 416 N.W.2d 485, 487, 491 (Minn. App. 1987) (upholding action of State Board of Medical Examiners ordering discipline against the individual physician who overprescribed benzodiazepines to patient); Gonzales v. Nork, N. 228566 (Cal. Super. Ct., Nov. 19, 1973) (excerpted in, Barry Furrow et al., Health Law: Cases, Materials and Problems 164-92 (1987) (substance abuse, coercion of patients, gross incompetence in performing surgery), remanded on other grounds, 573 P.2d 458 (Cal. 1978)).

255

Furrow, supra note 221, at 153.

256

Id. at 153.

257

Devon C. McGraw, Financial Incentives to Limit Services: Should Physicians be Required to Disclose These to Patients?, 83 Ger. L. J. 1821 (1995).

258

Rand E. Rosenblatt, Equality, Entitlement, and National Health Care Reform: The Challenge of Managed Competition and Managed Care, 60 Brook. L. Rev. 105, 126 (1994).

259

See Rosenberg & Zaring, supra note 22.

260

Rosenblatt, supra note 258, at 138.

261

Id. at 108.

262

McGraw, supra note 257, at 1826.

263

Id. at 1824.

264

Rosenberg & Zaring, supra note 22, at 553.

265

Id.

266

Id.

267

Id. at 554.

268

Elizabeth Anderson, Administering Health Care: Lessons from the Health Care Financing Administration's Waiver Policy-Making, 10 J.L. & Pol. 215 (1994); Rand E. Rosenblatt, Health Care Reform and Administrative Law: A Structural Approach, 88 Yale L.J. 243, 288 (1978).

269

Marsha Gold & Suzanne Felt, Reconciling Practice and Theory: Challenges in Monitoring Medicaid Managed-Care Quality, 16 Health Care Financing Rev. 85-106 (1995).

270

Id. at 85-106; Harris Myer, Quality Problems Could Spell Trouble for Medicaid HMOs, 38 Am. Med. News 9-10 (Jan. 23, 1995) (reporting problems with Florida, California, and Tennessee).

271

Perkins & Melden, supra note 128, at 26-30.

272

Id. at 27.

273

Oregon Waiver Application, supra note 36, at 5.11; Tennessee Waiver Application, supra note 30, at 7.

274

Tennessee Waiver Application, supra note 30, at 57. The Handbooks provided by the MCOs must include a description of services available, including preventive services which include: regular checkups for adults and children, care for women expecting a baby, well baby care, shots for adults, tests for cholesterol, blood sugar, colon and rectal cancer, bone hardness, sexually transmitted diseases, HIV, AIDS, pap smears, mammograms for breast cancer, urine tests, EKG test, test for hearing, birth control information, and EPSDT for children under 21. All handbooks are required to have specific language regarding EPSDT.

275

Tennessee Waiver Application, supra note 30, at 57. Despite the outline of these goals, “it was months before computer systems and administrative procedures were developed to the point where those applications could be processed.” Bonnyman, Private Interview, at 8. “Good information on the care patterns of individuals is not routinely available. Nor is there readily available data on how these patterns vary by important characteristics such as income, race, or insurance status.” Id.

276

See generally Tennessee Waiver Application, supra note 30.

277

For instance, Oregon's goals include: (1) Pregnancy outcomes will improve as indicated by birth weight and neonatal mortality; (2) incidence of severe untreated conditions among new eligibles will improve; (3) provider adherence to accepted practice standards for selected tracer diagnoses will improve during course of demonstration; (4) current eligibles will report no change in quality of care; new eligibles will report increased quality of care; (5) the health status for both self reported and based health outcomes for tracer conditions will, of new eligibles will improve, and; (6) mortality rates among new eligibles will be reduced and show no change for current eligibles. Oregon Waiver Application, supra note 36, at 5.11.

278

See generally Missouri Waiver Application, supra note 34.

279

See generally Florida Waiver Application, supra note 31.

280

Hawaii Waiver Application, supra note 32, at exhibit 4-1.

281

See generally New York Waiver Application, supra note 35. New York's application states that data collection will be used to improve health care, it does not indicate how the statistical data will be used. Id. at 67 (State of New York's answers to HCQFA questions, Aug. 1995). The application does require that managed care organizations have several quality assurance, credentialing, and utilization review committees and a medical director responsible for quality assurance. Id. at 66. Although these operations are required by the application, there do not appear to any optimal levels at which the managed care organizations are supposed to perform. A demonstrative monitoring system is supposed to collect data as to the availability of urgent and routine care, adequate telephone lines, enrollee inquiries, and follow-ups on missed appointments. Id. However, the application indicates that the Advisory Committee should take this information into consideration in making suggestions for improvements. Id. It does not indicate a goal that the suggestions should aim for other than the ambiguous concept of improving health care. Id.

282

Perkins & Melden, supra note 128, at 27, 28.

283

Florida has no goals directly related to reducing the disparities in health status between minority vs. nonminority populations. See generally Florida Waiver Application, supra note 31. However, Florida does plan to examine the extent to which the health status of previously uninsured individuals improves during their participation in FHS. Id. at 201. Of course, axiomatic to this objective is the hypothesis that the health status of all FHS participants will maintain or improve during the course of the demonstration and that previously uninsured individuals will improve in health status after one, two, and three years of coverage. Id. All the generalized hypotheses regarding improved quality of care and health status do not address the real issues we are interested in the unique health concerns of minority populations. Second, in their effort to disassociate health care from Medicaid, Florida may be further ignoring the reality of the differences in health status between minority and nonminority populations. Similarly, neither Hawaii's nor New York's waiver addresses the racial disparity in health status. See generally Hawaii Waiver Application, supra note 32; New York Waiver Application, supra note 35; Missouri Waiver Application, supra note 34; Illinois Waiver Application, supra note 33; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30.

284

Missouri Waiver Application, supra note 34.

285

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30.

286

Perkins & Melden, supra note 128, at 26.

287

See generally New York Waiver Application, supra note 35.

288

Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32, at 4-10; Illinois Waiver Application, supra note 33, at 78; Missouri Waiver Application, supra note 34; Oregon Waiver Application, supra note 36, at 5-10; Tennessee Waiver Application, supra note 30.

289

Florida Waiver Application, supra note 31, at 41 (response to HCFA questions).

290

Id.

291

Id. at 209; Hawaii Waiver Application, supra note 32, at 4-9 to 4-17;

292

Florida Waiver Application, supra note 31, at 209; Hawaii Waiver Application, supra note 32, at 4-9 to 4-17; According to Hawaii's waiver application, beneficiary surveys should be administered to evaluate consumer satisfaction with the program and health plans. Hawaii Waiver Application, supra note 32, at 4-11. The surveys should be administered before, during, and after the demonstration project. Id. Subjects relating to consumer satisfaction which could be covered in the surveys are: the enrollment process, re-certification process, eligibility problem resolution, and the disenrollment process. Id. Questions regarding the health plan should include: convenience, difficulty in establishing a primary care provider, responsiveness in nonemergency visits, patient rapport and confidence, availability of specialty care, treatment by nonmedical support personnel, treatment by medical support personnel, grievances handled quickly and fairly, health plan requirements and procedures, cost considerations, referral problems, and billing problems. Id. at 4-12. Plan and provider surveys assess their satisfaction with the program. Id. Health and service plans would be questioned regarding factors affecting their decision to participate in the program. Id. at 4-13. Oregon's waiver incudes a survey of clients that disenroll form health plans and quarterly client service utilization reports from the plans. United States General Accounting Office, Medicaid: Oregon's Managed Care Program and Implications for Expansions, GAO-HRD 92-89 at 35 (June 1992).

293

Florida Waiver Application, supra note 31, at 209; Hawaii Waiver Application, supra note 32, at 4-12. Medical records analysis would evaluate the changes in health status on the basis of medical record documentation of encounters, including preventative care, diagnosis, treatment, referrals, and outcomes. Hawaii Waiver Application, supra note 32, at 4-12.

294

Hawaii Waiver Application, supra note 32, at 4-19. According to the Hawaii Waiver Application a number of issues may be addressed in the case study interviews are: (1) program expectations for the state, providers, eligible, etc.; (2) reasons policy and operational decisions; (3) needed changes in operations; (4) factors influencing the plan's capitation rates and delivery system; (5) effectiveness of outreach and enrollment strategies, and; (6) adequacy of program in meeting the needs of special populations. Id. at 4-9. Furthermore, the waiver lists quite a few people who may be interviewed for this purpose. Administrators and staff from the Department of Human Services, Department of Health, State Health Planning and Development Agency, legislatures, representatives of both participating and nonparticipating health plans, medical care advisory board, and welfare advocacy and other citizen consumer groups are all listed as potential interviewees. Id.

295

Florida Waiver Application, supra note 31, at 209; Hawaii Waiver Application, supra note 32, at 4-9. Florida's AHP Performance Data System will provide the minimum data set for FHSP participants and is comprised of indicators that combine the HEDIS with other data elements. Florida Waiver Application, supra note 31, at 42 (responses to HCFA questions). HEDIS focuses on outcomes, health status, and satisfaction, while the new Performance Data System will use quality, health status, access, utilization, satisfaction, and cost efficiency as indicators. Id. The AHP Performance Data System is supposed to provide more information on FHS participants than Florida now gets for Medicaid recipients. Id. at 43. Although this is commendable, it is curious that Florida is not providing as comprehensive data collection for Medicaid recipients.

296

Hawaii Waiver Application, supra note 32, at 4-10 (indicating sources for this data as Medicaid claims from the state Medicaid Management Information System, current statistical and utilization information from the SHIP program, and the demonstration data set from the plans).

297

New York Waiver Application, supra note 35, at 4-1. Although the Medicaid Management Information System (MMIS) retains the enrollment information and eligibility criteria of recipients, a second system will use “Demonstration Data Sets” to record encounter information for services. Id. at 4-15. According to the waiver application, the services that are to be tracked include: professional service, dental, transportation, vision, inpatient, outpatient, and home health. Id. The term “drug” is included in the list of services covered by the data set, but the term is ambiguous as to the meaning. See id. The term may be referring to prescription drugs or to the use of substance (drug) abuse treatment services.

298

Oregon Waiver Application, supra note 36, at 5.10.

299

Tennessee Waiver Application, supra note 30, at 36.

300

Id.

301

Tennessee Health Care Campaign, May 13, 1995. Yet, the assessment of the monitoring to date is that the focus, is on the process and structure; little analysis of the data has taken place. The Tennessee Health Care Campaign issued recommendations in May 1995. Among its comments were that handbooks for enrollees which provide a road map to tell enrollees where to go for care and how to access care have in many cases not been issued. Tennessee Health Care Campaign, May 13, 1995. Their criticism is that information regarding access and quality control to both the provider and the enrollee is only available through the media and not from official documents or analysis.

302

Florida Waiver Application, supra note 31, at 43. HEDIS indicators will allow for cross-state comparisons and will provide AHP information directly to consumers. Florida proposes a data system that is not based on a separate system of claims-based encounter level data collection for FHS participants. Id. The reason behind this makes sense in the FHS framework creating such a data system would identify and set apart FHS participants from other participants of plans, thus identifying FHS participants with the welfare label. Id. Again, this leaves the impression that Florida is going to abandon the traditional Medicaid population in favor of its section 1115 population.

A further component of the AHP reporting system will require AHPs to submit data to AHCA on performance indicators such as mammography and cervical cancer screening rates, chronic disease follow-up rates, low birth weight rates, and postoperative wound infection rates. Id. at 46 (responses to HCFA questions). FHS participants complete the “RAND 36-Item Survey 1.0” at enrollment and annual reenrollment. Id. at 217. This survey appears to address patients' subjective opinions of their pain level and daily ability to function.

303

See generally Florida Waiver Application, supra note 31.

304

Hawaii Waiver Application, supra note 32, at 4-17.

305

New York Waiver Application, supra note 35, at 4-15 (listing gender, age, location, plan status, and rates).

306

Oregon Waiver Application, supra note 36, at 5-10. Oregon's minority population is not heavily monitored and this may mean the state has not considered using these data factors as indications of quality care. See id.

307

New York Waiver Application, supra note 35, at 4-15.

308

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30.

309

Perkins & Melden, supra note 128, at 28.

310

Id.

311

See generally Hawaii Waiver Application, supra note 32; Illinois Waiver Application, supra note 33; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30, at 6, 7, 36, 45.

312

Oregon Managed Care, supra note 292.

313

Perkins & Melden, supra note 128, at 28.

314

Id.

315

Florida Waiver Application, supra note 31, at 14, 15, 18, 19 (responses to HCFA questions); Oregon Managed Care Programs, supra note 292.

316

See generally Oregon Waiver Application, supra note 36; Illinois Waiver Application, supra note 33.

317

See generally Florida Waiver Application, supra note 31.

318

See generally Hawaii Waiver Application, supra note 32; Missouri Waiver Application, supra note 34; New York Waiver Application, supra note 35; Tennessee Waiver Application, supra note 30.

319

Bruce Bronzan, Keynote Address: The Twelfth Annual Health Law Symposium, 15 Whittier L. Rev. 75 (1994).

320

321

Perkins & Melden, supra note 128, at 30.

322

See generally Missouri Waiver Application, supra note 34; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36, at 3.17.

323

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; Illinois Waiver Application, supra note 33; Tennessee Waiver Application, supra note 30.

324

See generally Florida Waiver Application, supra note 31; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30.

325

See generally Florida Waiver Application, supra note 31; Illinois Waiver Application, supra note 33; New York Waiver Application, supra note 35, at 69; Oregon Waiver Application, supra note 36, at 35; Tennessee Waiver Application, supra note 30.

326

Perkins & Melden, supra note 128, at 29.

327

Id.

328

Id.

329

Id.

330

Id.

331

Oregon Waiver Application, supra note 36, at 3-14.

332

See generally Florida Waiver Application, supra note 31; Missouri Waiver Application, supra note 34; Illinois Waiver Application, supra note 33, at 15; Oregon Waiver Application, supra note 36, at 3-14; Tennessee Waiver Application, supra note 30, at 12-13, 12.03; Hawaii Waiver Application, supra note 32, at 2-9; New York Waiver Application, supra note 35, at 2-25.

333

See generally Missouri Waiver Application, supra note 34.

334

Perkins & Melden, supra note 128, at 30.

335

Id.

336

See generally Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36.

337

Perkins & Melden, supra note 128, at 30.

338

Id. at 28-29.

339

Id. at 29.

340

Id.

341

See generally Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34; Oregon Waiver Application, supra note 36.

342

See Vernellia R. Randall, Utilization Review and Financial Risk-Shifting: Will Managed Care Products Improve the Health Status of Ethnic Americans and the Underserved Population? 5 J. Health Care for the Poor & Underserved 224-37 (1994).

343

P.S. Bouey, Peer Review In Managed Care Setting, in Managed Health Care Legal and Operational Health (1988).

344

Richard A. Hinden & Douglas L. Elden, Liability Issues for Managed Care Entities, 14 Seton Hall Legis. J. 1-63 (1988).

345

Alexander M. Capron, Containing Health Care Costs, Ethical and Legal Implications of Changes in the Method of Paying Physicians, 36 Case W. Res. L. Rev. 708, 708-59 (1986).

346

M.E. Corcoran, Liability for Care in Managed Care Setting, in Managed Health Care Legal and Operational Health (1988).

347

P. Elwood, When MDS Meet DRGs, 57 Hosp. 62-63 (1983); E.H. Morreim, The MD and the DRG, 15 Hastings Center Rep. 34-35 (1985); Capron, supra note 347, at 708-59.

348

Rewards can be a predetermined fixed dollar amount, a fixed percentage of the surplus distributed among the risk pool, a bonus based on a physician's productivity or a combination of methods. The methods also include increasing fee schedules and allowing practitioners to become investors. A.L. Hillman, Financial Incentives for Physicians in HMO's-Is There a Conflict of Interest 317 New Eng. J. Med. 1744 (1987).

349

Some penalty mechanisms used to place the provider at risk beyond the withholding include: (1) increasing the percentage of payment withheld the following year; (2) placing liens on future earnings; (3) decreasing the amount of the capitation payment the following year; (4) excluding the physician from the program; (5) reducing the distributions from surplus; and (6) requiring physicians to pay either the entire amount of any deficit or some set percentage of the deficit. For example, a large percentage (approximately 40%) of managed care products require primary care physicians to pay for outpatient laboratory tests directly out of their capitation payments. HMOs also use peer pressure as a significant motivator. They develop a reporting system that informs providers of their performance compared with that of their peers. The reporting identifies areas of excessive costs and service intensity. Alan M. Gnessin, Liability in the Managed Care Setting, in Managed Health Care 1988: Legal and Operational Issues, at 405 (PLI Commercial Law & Practice Course Handbook Series No. A4-4275, 1988).

350

Gnessin, supra note 349.

351

G.D. Powers, Allocation of Risk in Managed Care Programs, in Managed Health Care Legal and Operational Issues (1988).

352

Gnessin, supra, note 349.

353

With capitation, a provider (or provider group) is paid a set fee per enrollee. The group then provides all necessary physician services. The primary care physicians are the “gatekeepers” to specialists and hospital services and are financially responsible for utilization. Because the amount of payment to the physician group is independent of the actual services rendered, the group takes on the risks of an insurer. Capron, supra note 345, at 708-59.

354

When managed care products utilizes withholding, they shift part of the risk by withholding part of the provider's periodic fee for service payments for a claim period. The managed care products usually withhold from 5% to 20%. At the end of a claim period, a medical claim trend is determined and compared to a target medical claim trend. If the actual medical claim trend is lower than the target, the withheld funds are paid to the providers. If the actual medical claim trend exceeds the target, the withheld funds are paid to the payer. 42 U.S.C. s 1396.

355

If the managed care product utilizes a discounted fee for service, they obtain an up-front agreement that the providers give a discount to the payer on amounts due. The managed care product assumes the risk that the payer's premium will be sufficient to cover hospital charges. However, there is no participation by hospitals in profits of the managed care products and payers which contract with hospitals without a discount may pressure the hospital for a discount, but discounted charges may be insufficient to cover the hospital's actual costs. 42 U.S.C. s 1396.

356

With per diem payments, hospitals are paid a flat rate per patient day which must cover all necessary services. The advantage of per diem payments is that the hospital is not at risk for length of stay. However, if the managed care product also has an emphasis on early discharge, then the hospital's total income may be reduced because the predetermined per diem payments are too low for the hospital to cover its costs and the managed care product discharges the patient before the hospital can “break even” by averaging cheaper end-of-stay days with the more expensive beginning-of-stay days. 42 U.S.C. s 1396.

357

With case mechanisms, based on the diagnosis, a predetermined amount is paid to the hospital for each admission. The hospital is then at risk for the treatment and the length of stay.

358

Finally, similar to capitation, hospitals are paid capitated payments per patient. That is, a hospital is paid a lump sum per enrollee in the hospital's service area to provide all covered hospital services required by those enrollees. Because the hospital's payments are independent of the actual services rendered by the hospital, the hospital is assuming the role of an insurer.

359

42 U.S.C. s 1396.

360

C.M. Clancy & B.E. Hillner, Physicians as Gatekeeper: The Impact of Financial Incentives, 149 Arch. Intern. Med. 917-20 (1989).

361

Paul Starr, The Social Transformation of American Medicine (1984).

362

W.L. Dowling & P.A. Armstrong, The Hospital, in Introduction to Health Services (1992).

363

Missouri Medicaid Managed Care Program Working Copy Incorporating Amendments 001-009, RFP B500406, 7, Bureau of Tenncare Rule 1200-13-12-01 (24).

364

See generally Hawaii Waiver Application, supra note 32; New York Waiver Application, supra note 35.

365

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32.

366

Randall, supra note 340, at 230.

367

Id. at 231.

368

David R. Williams, Socioeconomic Differences in Health: A Review and Redirection, 53 Soc. Psychol. Q. 81-99 (1990); David R. Williams, et al., The Concept of Race and Health Status in America, 109 Pub. Health Rep. 26, 26-42 (1993).

369

The National Institutes of Health now requires all grant applicants to include women and minorities in study samples or provide justification for their exclusion. Williams et al., supra note 368, at 26-42.

370

Illinois Waiver Application, supra note 33, at 62.

371

Id.

372

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36; Tennessee Waiver Application, supra note 30.

373

See generally Illinois Waiver Application, supra note 33; Missouri Waiver Application, supra note 34; Tennessee Waiver Application, supra note 30.

374

See generally Florida Waiver Application, supra note 31; Hawaii Waiver Application, supra note 32; Illinois Waiver Application, supra note 33; Tennessee Waiver Application, supra note 30.

375

Hawaii Waiver Application, supra note 32, at 2-10; Illinois Waiver Application, supra note 33, at 56.

376

Hawaii Waiver Application, supra note 32, at 5-1; Illinois Waiver Application, supra note 33, at 57; Oregon Waiver Application, supra note 36, at 3.34; see generally, Contractor Risk Agreement between Tenncare & Contractor.

377

See generally Missouri Waiver Application, supra note 34; Oregon Waiver Application, supra note 36; Contractor Risk Agreement between Tenncare & Contractor.

378

See generally Hawaii Waiver Application, supra note 32.

379

See generally Florida Waiver Application, supra note 31; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36.

380

See generally Hawaii Waiver Application, supra note 32.

381

See generally Florida Waiver Application, supra note 31; New York Waiver Application, supra note 35; Oregon Waiver Application, supra note 36.